Tatarstan-based chemical company Ammony is to build a $1.5bn chemical plant in the town of Mendeleevsk, the Republic of Tatarstan, regional officials report.

The project is being financed by the Tatarstan Venture Capital Fund and Vnesheconombank, officials say.

Under plans, the plant is to be built on the existing premises of the company's Mendeleevskazot subsidiary.

Projected annual capacity at the plant is 455,000 tons of ammonia, 238,000 tons of methanol and 717,500 tons of granulated carbamide.

Japanese giant Mitsubishi Heavy Industries has been named as a contractor for the project, while gas and water were to be supplied by local Gazprom subsidiary Tatgazinvest, officials added.

Construction is scheduled to last 36 months, with the plant set to be put into commission in Q1 2012.